Choose from Different Types of Loans

There are different types of financing, including installment and auto loans and cash advances. They are offered by different financial establishments, including banks, caisses populaires, savings and loan associations, and others. Loans are reserved for creditworthy customers with solid income.

Borrowers can choose from different types of loans, depending on the purpose and amount required. Car financing is offered by banks, credit unions, dealerships, and other entities. The interest rate and term depends on the loan amount, vehicle to be purchased, amount offered as a down payment, and other factors. Student loans are also offered by banks, government agencies, and other entities. Students benefit from competitive interest rates and flexible repayment solutions while the funds can be used for college-related expenses such as books, textbooks, and tuition and board. Collateral is not required when applying for an unsecured loan, whether student, auto, or consumer loan. Financial institutions look at factors such as level of indebtedness and credit standing. Applicants with poor credit often resort to bad credit loans, payday lenders, and other options.

Individual lenders and finance companies offer loans regardless of the borrower’s credit standing. It takes weeks to get approved for a standard bank loan but payday lenders advertise instant approval. Both non-bank lenders and banks offer payday loans as an alternative to standard types of financing. Borrowers usually resort to payday loans to pay urgent expenses such as medical and hospital bills. Payday lenders have more lenient criteria, and it is easier to qualify. These loans come with extremely high interest rates and fees and are a risky option. A cash advance is a short-term solution, and another option is to apply for a secured loan. When applying for a secured loan, banks require proof of residence and income. Another option is to ask your family for a small loan or to apply with a cosigner.

There are certain documents to enclose, including recent telephone and electricity bills, latest salary slips, etc. The types of documents required depend on the employment status of the applicant. The requirements are different for self-employed individuals and unemployed workers. Banks also offer unsecured business loans and require verification of business and non-business income, business leases, and other documents.